GBP/USD falls to two week low

Good afternoon,

It has been a quite day in terms of economic data releases today but that hasn't stopped the dollar gaining ground against the pound. The GBP/USD cross fell by 0.4%, leaving exchange rates at their lowest level for two weeks. When trading opened this morning Sterling/dollar was sitting just above $1.7140 but steadily dropped over the course of the day reaching a low of $1.7071 as the graph below shows.

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Although it has been a quite start to the week there is plenty coming up over the next couple of days which is likely to cause some volatility in the currency markets. This week will see key speeches from the Bank of England Governor Mark Carney and Fed Chair Janet Yellen, with the later due to testify on the Semi-annual Monetary Policy report in front of the Senate Banking Committee in Washington.

How could this impact exchange rates?

The testimony is usually delivered in two parts which will begin with Mrs Yellen reading a prepared statement highlighting the Feds thoughts and plans. The statement is then followed by a question and answers session which is held by the committee, this usually leads to some heavy market movements as the questions aimed at Mrs Yellen are not known before hand and are designed to put the Fed Chair under the spotlight.

So what next for the GBP/USD cross.

As I mentioned last week it seems the pounds gains against the dollar are starting to run out of steam. With it looking likely the U.S. Federal Reserve will have wound up their stimulus package by October there has been growing speculation the dollar will start to strengthen over the coming months.

If you need to buy dollars in the coming weeks or months and want to take advantage of the current rate (which is still close to the highest trading levels for six years), there are a number of different options available to help you make the most from your transfer.

For more information on the types of currency contracts that are available or to find out what rates I can offer, use the link below to complete the contact form or call me directly on 0044 (0) 1442 892 065.

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